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The Beltway Media's Best-Kept Budget Secret | The Nation

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Eric Alterman

Eric Alterman

Well-chosen words on music, movies and politics, with the occasional special guest.

The Beltway Media's Best-Kept Budget Secret

My new Think Again column is called “Campaign-Finance Reform in an Age of Corporate Influence,” and it’s here.

My new Nation column is called More BS About 'Both Sides' and it’s here.

Below is a copy of a letter I sent to The Forward regarding the newspaper’s coverage of the hiring of Josh Block to run The Israel Project. The sections in bold are the ones they chose not to run. (It was edited without my participation and The Forward does not appear to have updated the “letters” section of its website since December.)

1 April 2013

To the Editor:

I was disappointed to read The Forward’s coverage of The Israel Project’s hiring of ex-AIPAC flack Josh Block to be its new head. According to your coverage, “Block entered a highly publicized quarrel with the Center for American Progress, a progressive Democratic think tank whose views on Israel, according to Block, were biased and at times ’borderline anti-Semitic.’”

Actually, Block did not accuse the entire center with this term. He referred specifically to yours truly. I thought it rather funny at the time, given that I was also a columnist for The Forward, which rarely offers regular columns to anti-Semites, “borderline” or otherwise. Moreover, the quote of mine to which he specifically referred as allegedly anti-Semitic merely called attention to AIPAC’s desire to see the United States attack Iran. This is hardly a controversial view regarding AIPAC’s aims, even among its supporters. As it happens, I felt forced to resign my Forward column over the enforced delay I experienced in responding to Block’s McCarthyite attack on CAP and myself in the Forward’s pages. So that was one victory for Mr. Block. He has won yet another with the Forward’s coverage of his appointment. Here, again, Block’s false charge against the Center for American Progress (where I was, and remain, a senior fellow) was repeated, albeit inaccurately, without any response from the accused, nor any context for readers unfamiliar with Mr. Block’s nefarious tactics. (It was a rather big deal at the time, and was covered in The Forward’s news and editorial pages). 

It’s shame that yet another Jewish political institution will now likely adapt such tactics with regard intra-community disagreements, but that is clearly the direction The Israel Project has chosen in picking Mr. Block to represent it. What remains unclear to me, however, is why The Forward, whose reporting on Jewish political organizations is second to none, chooses to sugarcoat these actions, and in doing so, encourage their continued abuse by Mr. Block and his allies in the future.

Sincerely,

Eric Alterman

Former Forward Columnist

Interesting how The Forward kept in the compliment I gave them regarding “second to none” but took out every other reference, including especially, the reason I resigned. Note also that the letter does not now reveal that I was the topic of Block’s attack, which could lead to accusations that I sought to cover this up in my criticism of The Israel Project’s decision to hire him.

Alter-reviews: Here’s Danny Goldberg on the new film, War on Whistleblowers.

Robert Greenwald, whose previous films include the great "Outfoxed"  has a new film about the way that the US government has discouraged and sometimes published whistle-blowers ."War on Whistleblowers" highlights four cases where whistleblowers noticed government wrong-doing and took to the media to expose the fraud and abuse. It exposes the surprisingly worsening reality for whistleblowers and the press.

The film includes interviews with award-winning journalists David Carr, Lucy Dalgish, Glenn Greenwald, Seymour Hersh, Michael Isikoff, Bill Keller, Eric Lipton, Jane Mayer and Dana Priest. More info, trailer and info about downloading here.

Now here’s Reed:

My cover story for The Nation magazine this week, "GOP-Fox Circus Act," is now up. It’s a long, detailed look at how the network, despite suffering from the same worsening symptoms as the Republican Party it shamelessly fronts for, has changed little since the 2012 election. And how honest conservatives are suffering from the co-dependent relationship between the two. (And a big thanks to the proprietor of this blog for giving me the platform here every week that eventually led to me getting the chance to write it.)

The Beltway Media’s Best-Kept Budget Secret: Social Security Does Not Add to the Deficit
by Reed Richardson

Let me sketch out a ridiculous, outlandish conspiracy theory for you. It involves an overwhelming majority of the nation’s establishment media, who meet secretly so that they can uniformly mislead the public into believing one of our most popular safety net programs has a deleterious impact on our federal budget. At times, this misinformation campaign is brazenly direct, and might involve using op-ed columnists and TV pundits to endorse the wrongheaded conclusions of bipartisan presidential commissions. Most other times, though, this insidious, dark-cloaked cabal works more subtly (as all great conspiracies do), choosing to confuse the debate through carefully positioned citations of conventional wisdom and sly rhetorical conflation of thoroughly dissimilar fiscal platforms. After enough time, this falsehood might even come to be seen as true among many of our government’s key decision makers. And only by the grace of God, the bracing power of common sense, and perhaps a healthy dose of fear about being left destitute in old age, does the public resist buying into this same propaganda.

Crazy, right?

Well no. In fact, this same familiar scenario played out this past week after President Obama released his latest federal budget proposal. (OK, I have no proof about the secret meetings or the dark cloaks.) With the White House budget’s inclusion of a benefit cut to Social Security—by embracing a chained-CPI cost-of-living adjustment for recipients—the American public was once again treated to a widespread assault on the truth regarding what Social Security is, what it does, and, most importantly, what it does not do. Fortunately, there is a simple mantra one can use to avoid all these distortions. Reporters, producers, pundits, bloggers—repeat after me:

Social Security does not add to the debt.

Social Security does not add to the deficit.

Social Security has nothing to do with the deficit. (Special for our conservative readers.)

I know, I know. How can these statements be true? After all, no serious person in Washington has ever admitted as much. Even the illustrious fact-checkers at the Washington Post and Associated Press say it does add to the deficit, as does the editorial board of a national newspaper. Isn’t it just the dirty hippies who think this way—along with other crackpots like Pulitzer Prize-winning economist Paul Krugman and conservative Social Security trustee Charles Blahous?

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The fact is that, Social Security cannot contribute to the federal budget deficit because, by law, the program is not a part of the federal government’s “on-budget” accounting, as it’s called. (See slide 14 of this CBO report.) But the mainstream press routinely dismisses this part of the US Code as mere artifice, and loves to point out that the federal government pays out Social Security revenue as fast as it comes in and then borrows against it for more spending. All that’s left, then, is supposedly a bunch of government “IOU”s—a favorite trope of Social Security Cassandras. But here’s someone much smarter than me—George Washington University political scientist professor Robert Stoker, explaining how the Beltway conventional wisdom goes totally awry with this analogy:

If you owe a $5,000 credit card bill and you take a home equity loan to pay off the credit card, your total debt has not changed; you have refinanced the debt, transferring it from one financial instrument (and one creditor) to another. Much the same can be said about repaying the OASDI Trust Fund. The fund’s assets are composed of debts already accounted for as part of the nation’s total debt. When the Treasury borrows to pay current Social Security benefits, the debt owed to the Social Security Trust Fund is repaid, refinanced, and transferred to whoever purchases Treasury securities.

Of course, the cost of refinancing the debt is a key concern. However, the only scenario in which repaying the Social Security Trust Fund can increase the nation’s debt is if interest rates are higher now than they were when the original debt was incurred. Given current market conditions (nominal interest rates are presently quite low, the rate on ten-year Treasury Bonds is around two percent), the more plausible claim is that refinancing the Social Security Trust Fund’s debt has reduced the nation’s debt slightly by reducing interest costs” [italics mine].

Yes, you read that last part right, the negative interest rate spread we’re currently enjoying actually means borrowing money effectively lowers the deficit. (One note of caution, probably not wise to share this bit of data with any right-wing friends in the midst of taking a drink.) How this reality plays in the press looks radically different, though, as I found after trolling through dozens of news articles about the president’s budget this past week.

Among the worst offenders of up-is-down reporting, somewhat ironically, was this CNNMoney report that explicitly tied Social Security and the deficit together:

All told, the switch to chained CPI could reduce spending over ten years by $216 billion and raise $124 billion in revenue, according to Congressional Budget Office estimates. That would mean total deficit reduction of $340 billion, before counting interest savings.

This is falling directly into the Republican trap of conflating Social Security “entitlement cuts” as necessary to stem out of-control spending. Thankfully, most of the rest of the media wasn’t this brazenly wrong, but that doesn’t mean they’re not marching to the sound of the same out-of-step drummer. For example, below is the opening paragraph of the Associated Press’s big lead story on President Obama’s budget. It’s Social Security-deficit conflation manipulation is one step removed, but noticing that nuance is beyond mere mortals, and certainly out of reach for most Congressmen. By lumping Social Security cuts in with other stuff as one big “debt reduction” deal, the point is made:

President Barack Obama’s proposed budget will call for reductions in the growth of Social Security and other benefit programs while still insisting on more taxes from the wealthy in a renewed attempt to strike a broad deficit-cutting deal with Republicans.

This Washington Post lead story on the budget commits the same sin, juxtaposing the two disparate items into the same thought:

Obama also proposes to slow the growth of Social Security benefits through chained CPI, trimming cost-of-living increases by roughly three-tenths of a percentage point a year and saving the government about $130 billion over the next decade.

White House officials said the change would not affect programs for the poor, such as Supplemental Security Income, or SSI, and would be adjusted to reduce the impact on retirees 77 or older. Still, the proposal has infuriated many Democrats, who have long demanded that Social Security be protected from any debt-reduction deal.

Gee, I wonder why many Democrats might be infuriated? Oh yeah, probably because Social Security does not add to the debt. Guess that motivation isn’t worth mentioning, though. Sadly, The New York Times’s straight news coverage stumbled over this Democratic anger as well. In last Friday’s front-page story, the Times ambiguously conjoins the two and omits any mention of why those on the left might be, again, “infuriated”:

President Obama next week will take the political risk of formally proposing cuts to Social Security and Medicare in his annual budget in an effort to demonstrate his willingness to compromise with Republicans and revive prospects for a long-term deficit-reduction deal, administration officials say. […]

The idea, known as chained C.P.I., has infuriated some Democrats and advocacy groups to Mr. Obama’s left, and they have already mobilized in opposition.

Over at Politico, one could read any number of its trademark process stories, like this one, that obsessed over the insider details of the budget deal, and encounter the same mistaken formulation:

There was some praise from Republicans about the inclusion of ‘chained CPI,’ a provision that would reduce Social Security benefits in the long run. Obama offered the language as an olive branch to Republicans in hopes it would help kick off a large-scale deficit deal.

Funny that a cut in a program like Social Security, which you might have heard, doesn’t add to the deficit, is characterized as a something that would “kick off” a deal on the deficit. Still, let’s give (partial) credit where it’s due. Nine paragraphs later, the article does at least quote Sen. Sheldon Whitehouse as saying: “Social Security hasn’t contributed to the deficit and shouldn’t be included in deficit talks.” But sticking a fact inside a politician’s quote is an age-old journalistic trick to effectively undermines it; it’s a way to sidestep controversy and taint the truth by ascribing it to a “biased” source. To see how the pros at this behave, look no further than this Fox News story, which establishes that only the radical left cares about preserving Social Security:

The 2014 plan, delivered to Congress Wednesday morning, was pitched by Obama as a compromise—twinning tax increases, which Republicans dislike, with changes to Social Security, which liberal Democrats despise.

That’s true, liberal Democrats do object to sacrificing the sanctity of a vital social insurance program on the (phony) altar of deficit reduction. Probably because Social Security doesn’t add to the deficit. And this viewpoint, I might add, is actually shared by a majority of Americans, including half of independents and nearly four out of ten Republicans. Although you likely wouldn’t know it from consuming the mainstream media’s output the past week. Indeed, only by venturing into the realm of subjective reasoning, like the New York Times editorial page, might one finally encounter a reality-based approach to the deficit/debt and Social Security reform, which are two distinct issues:

Social Security reforms should be decided separately because the program is not driving the deficit…Social Security did not cause today’s deficits, because the payroll taxes that support it have been more than adequate; and it will not contribute to future debt, because it is barred from spending more than it takes in.”

Hallelujah! But sadly, what little the Beltway media giveth in terms of the truth, it quickly tries to take away, as the frighteningly predictable lead editorial in yesterday’s Washington Post demonstrates:

Unlike the Senate Democrats’ budget, Mr. Obama’s does not pretend that deficits can be meaningfully reduced by soaking the rich while largely avoiding entitlements.

Most important, the president committed himself in writing to more than $100 billion in Social Security spending restraint over the next decade, along with $400 billion in health program reductions. Mr. Obama too often casts entitlement reform as a concession to extract Republican assent to higher taxes, rather than a worthy end in itself [italics mine].

Here, the Post can’t quite let itself explicitly acknowledge that, yes, Social Security has nothing to do with the deficit, so readers are treated to a clever usage of a euphemism, “spending restraint” that merely implies the same thing. But then they just come right out and say what the Beltway’s thinking is really all about—cutting Social Security is all about doing it for the sake of doing it—a “worthy end in itself.” Pain for pain’s sake.

So, let’s be 100-percent clear, to misunderstand and then misrepresent how Social Security figures into our national debt and deficit is gross injustice. By helping to propagate this myth among our nation’s leaders, the press is guilty of nothing less than journalistic malpractice. And for a profession that proclaims its devotion to objectivity, it’s critical to point out that media’s failure here significantly redounds to the political benefit of the party and ideology of the right-wing. (Although, to be fair, this president also enjoys the fruits of this misreporting, as it makes his callous ploy of sacrificing the quality of life of our nation’s seniors on an altar of phony debt reduction and legacy building less obviously craven and depraved.)

Ten years ago, our establishment media failed spectacularly, resulting in a disastrous war that claimed hundreds of thousands of lives and cost trillions of dollars. This, despite the fact that its premise was known to be false at the time we launched it. So, one has to wonder if, ten years hence, the tattered remnants of the most effective social insurance program in our nation’s history will occasion another pathetic round of self-recrimination among the press corps. The same names and publications will shrug their collective shoulders and admit that thing might have turned out differently, if only they’d admitted the obvious truth: Social Security does not contribute to the deficit.

Contact me directly at reedfrichardson (at) gmail dot com. Also, I’m on Twitter here—(at)reedfrich.

Editor's note: To contact Eric Alterman, use this form.

For more on Josh Block and The Israel Project, see Eric Alterman's last blog post.

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